Market Observation: Cotton Market Suggestions For The Time Being To Wait And See

 

American cotton a small number of point price trading, not point price contract volume from the high slightly down. Domestic cotton spot price stable slightly down, most cotton enterprises have strong promotion enthusiasm, but the downstream transaction is still cold. Cotton prices continued to run at a high level, and the conduction to the downstream was not smooth. As of the end of March, the lint sales rate in China decreased by 39.5% year-on-year. Most of the small mills are facing a deficit situation, with relatively low prices of cotton or lint from domestic production, which is barely maintained.

Last week, the start-up rate of printing and dyeing plants was only 66%. Due to the upgrading of epidemic prevention and control, many workers were unable to come to work, and the number of orders received decreased, which led to the enterprises to reduce their own operation.

In recent years, many places have been closed at high speed, the freight is rising, drivers are hard to find, and the transportation problems of raw materials and products are aggravating. It is expected that the start-up rate of textile factories will continue to decline. Due to the shortage of raw materials or the acceleration of the accumulation of finished products, the production cost of enterprises is still at a high level.

At present, the domestic cotton price is under short-term pressure, and the downstream demand continues to be weak, while the cotton ginning plant's willingness to support the price still exists. It is expected that Zheng cotton will maintain a volatile trend, and it is suggested to take a wait-and-see approach for the time being.